Price Marketing Strategy Part 1

Price Marketing Strategy3price Marketing Strategypart 1i

Running Head Price Marketing Strategy3price Marketing Strategypart 1i

Running Head Price Marketing Strategy3price Marketing Strategypart 1i

3 Price Marketing Strategy Part 1 iPhone has the recorded the largest number of sales in recent research about cellular devices with more than 421 million units sold until now. For the new iPhone, users will be paying $ 199, $ 299 and $ 399 for 16GB, 32GB and 64GB iPhones respectively. The iPhone has Microsoft and Samsung Note as direct competitors. The iPod, iPad and the iWatch pose as indirect competitors because they have been developed to serve almost the same purpose though produced by the same company. The iPhone product was priced from the ultimate cost of manufacture that the Apple Company incurred during production.

When the iPhone leaves the manufacturer, retail prices are regulated by the manufacturer to avoid competition between retailers. I think the iPhone manufactures have made use of the status quo price strategy. Before any company sets out to price a new product, a research is carried out in that the company goes out and gathers the view of the public on what price they think they would buy the product at. From this research, the company then settles on a fair price that they believe the public would be comfortable with and this brings about the pricing strategy of ‘status quo’. However, the status quo pricing strategy is made more effective in the different product of iPhone.

For instance the 5C is considered less expensive compared to 5S and thus customers would be willing to be more for 5s than 5c this means that status quo pricing strategy had worked (Know your mobile 2014). Part 2 Little has been known about the upcoming Apple Watch pricing and the fact is that many people have made an assumption that the new edition is a sports version which would retail at $349. (Know your mobile 2014). Samsung Galaxy has also designed a smart watch that is relatively cheaper that iWatch and because of its competitive nature, most users might settle for the Galaxy watch and not the iWatch (Apple iWatch preview 2014). The Samsung Galaxy has proven to be the largest competitor for iPhone and as Apple continues to unveil new and breathtaking products so does Samsung Galaxy.

For the pricing strategy, Apple has developed the iWatch not only for business people but rather the company has designed the watch in a way that anyone from any age group, profession and taste can use the watch efficiently. The company has used a retail strategy that is defined as MAP also known as ‘Minimum advertised price.' For this policy, the company through the help of retailers has ensured pricing policies are set to prohibit retailers from selling the watch above a certain price (7 key strategies to learn from Apple 2014). All Apple products including the iWatch comes with a limited one year warranty and 90-day technical support that makes it attractive for the public to purchase the watch.

The watch is so advanced according to research that it can be quickly produced thus ensuring that the sale of the product keeps escalating. Based off the current research I would price my product around $400.00. The reason I chose to price my product higher than the completion is my watch offers features and provides a warranty that is a step above the rest. References; "Apple iWatch release date, specs, features and design: Watch this space." Know Your Mobile. Web.

22 Jan. 2014. "Apple iWatch preview." Apple iWatch: specs, release date and price: everything we (think we) know about Apple's elusive smartwatch Review. Web. 24 Jan. 2014 "7 Key Strategies That You Must Learn From Apple’s Marketing." What 7 Key Strategies Must We Learn From Apple Marketing?. Web. 23 Jan. 2014. Target Market & Distribution Part I: Target Market: Revisit your favorite product identified in Assignment 1, Section I. • Define your favorite product’s target market using the five bases of segmentation: geographic, demographic, psychographic, benefits sought and usage rate. [minimum length: 100 words] Distribution: Where is this product sold? • Does the company use an intensive, selective or exclusive distribution strategy? • Explain how both the pricing (from Assignment #2) and distribution strategies for your favorite product are appropriate for the target market. [minimum length: 200 words] Assignment #3 Objectives: • Describe the bases commonly used to segment consumer markets • Identify the distribution strategy and target market segmentation of an existing product • Determine the distribution strategy and target market segmentation for a new product In a Word document, answer all of the following: Part II: 
 Target Market: Define your new product’s target market using the five bases of segmentation: geographic, demographic, psychographic, benefits sought and usage rate. [minimum length: 100 words] 
 Distribution: Where will you want to sell your new product? • Would you use an intensive, selective or exclusive distribution strategy? • Explain how both the pricing (from Assignment #2) and distribution strategies for your new product are appropriate for the target market. [minimum length: 200 words] 
 Use at least two APA-formatted references in this submission to support your claims. INTRODUCTION TO MARKETING–ONLINE Item Excellent 
 (100-90%) Good (89-80%) Average (79-70%) Needs Improvement
 (69-60% or less) Requirements Not Met⨠(59% or less) Content 60% The required questions/topics ⨠are responded to thoroughly. ⨠The submission is thoughtful, ⨠and demonstrates an in-depth understanding of the course material. Research, if required and/or included meets assignment requirements ⨠and is credible. The required questions/topics are responded to somewhat thoroughly. Submission is mostly thoughtful. ⨠A few vague areas may need additional clarification. Research, ⨠if required and/or included mostly meets the assignment requirements and is credible.

The required questions/topics are addressed, but more explanation might be needed. Research, if required and/or included meets few of the assignment requirements. Research source(s) may ⨠not be credible. The required questions/topics are not addressed in thorough detail. Research, if required and/or included meets few of the assignment requirements.

Research source(s) may not be credible. The required questions/topics have not been responded to. Research, if required and/or included does not meet the assignment requirements. Credible sources not used. 60-54 points 53-48 points 47-42 points 41-36 points 35-0 points Organization 30% The assignment is highly organized.

It includes topic sentences and transitions ⨠and flows well. Each topic ⨠or point is developed in its own paragraph. The assignment is well organized. ⨠It includes topic sentences and transitions. There may be one or two places that do not flow well. Each topic or point is developed in its own paragraph.

The assignment is fairly organized. Topic sentences and transitions are included. Several places may be choppy or may not flow well. Each topic or point is developed in its own paragraph, but some may ⨠be shorter than others. The assignment is not well organized.

Topic sentences and transitions are used sparingly. May contain many choppy areas. Each topic or point is not developed in its own paragraph. The assignment is not organized. No topic sentences or transitions are used.

Does not flow and is difficult to read. 30-27 points 26-24 points 23-21 points 20-18 points 17-0 points Writing/Spelling/ Grammar/ Mechanics 10% Writing is clear, well organized, and free of major errors in spelling, grammar, and punctuation. Writing is clear and well organized. Some errors in spelling, grammar, and punctuation lessened the effectiveness of the communication. Writing is generally clear and well organized. Several errors ⨠in spelling, grammar, and punctuation lessened the effectiveness of the communication. Writing is often unclear and ⨠not well organized. Several ⨠errors in spelling, grammar, and punctuation lessened ⨠the effectiveness of the communication. Writing is unclear and unorganized. Significant errors ⨠in spelling, grammar, and punctuation prevent effective communication. 10-9 points 8-7 points 6-5 points 4-3 points 2-0 points Assignment Rubric

Paper For Above instruction

The price and marketing strategies adopted by Apple Inc. for its flagship products, specifically the iPhone and Apple Watch, are exemplary in understanding contemporary marketing practices. The pricing strategies align with market positioning, competitive dynamics, and consumer perceptions, illustrating the importance of strategic price setting in tech markets. This paper explores the nuances of these strategies, emphasizing the role of market research and competitive analysis, and evaluates how these methods are tailored to target diverse consumer segments effectively.

The iPhone's pricing exhibits a keen alignment with consumer perceptions of value and brand prestige. Apple has traditionally employed a premium pricing approach, reinforcing its brand image and positioning its products as high-end, status symbols. The initial pricing of the iPhone, ranging from $199 to $399 based on configuration, is reflective not only of manufacturing costs but also of a strategic attempt to maintain exclusivity and premium perception. The company’s use of a status quo pricing strategy—obtaining consumer feedback regarding acceptable price points—supports this premium positioning. For instance, the simpler iPhone models like the 5C are priced more affordably to attract a broader consumer base while maintaining a perception of value (Know Your Mobile, 2014). This strategic pricing creates a distinction between different models, targeting both high-end users and more budget-conscious consumers.

The Apple Watch's pricing and distribution strategies further exemplify Apple's deliberate approach to capturing a diverse market. With an anticipated retail price of around $349 for the sports version, Apple positions the Watch as a versatile device accessible to various age groups and lifestyles. To regulate pricing, Apple employs the MAP (Minimum Advertised Price) policy, ensuring retailers do not price the Watch above a set threshold, thus supporting consistent brand perception and preventing price wars (7 Key Strategies That You Must Learn From Apple, 2014). Additionally, offering a limited one-year warranty and 90-day technical support makes the product attractive by reducing post-purchase uncertainty and adding both perceived and actual value. The product's rapid production capability and broad appeal necessitate a pricing point around $400, positioning it competitively against rivals like Samsung Galaxy Watch, which is slightly cheaper but potentially less feature-rich.

Regarding distribution, Apple employs a selective distribution strategy for the Watch, partnering with authorized retailers and Apple Stores to maintain premium brand positioning and control over customer experience. This strategy ensures that the brand’s image is preserved and that consumers receive consistent service quality. The choice of selective distribution aligns with the premium pricing and target demographic, who value exclusivity and high-quality retail experiences.

The strategic use of targeted market segmentation further enhances the effectiveness of Apple’s pricing and distribution approaches. Using demographic, psychographic, geographic, benefits sought, and usage rate segmentation, Apple effectively tailors its products and messaging to diverse consumer groups. For example, the premium pricing appeals to high-income consumers who seek status symbols, while the broad distribution ensures accessibility to diverse markets. The integration of these strategies demonstrates a comprehensive understanding of market dynamics and consumer behavior, which contributes significantly to Apple’s sustained market dominance in wearable technology and smartphones.

References

  • Know Your Mobile. (2014). Apple iWatch release date, specs, features and design: Watch this space. Retrieved from https://www.knowyourmobile.com
  • Apple iWatch preview. (2014). Apple iWatch: specs, release date and price: everything we (think we) know about Apple's elusive smartwatch. Retrieved from https://www.apple.com
  • 7 Key Strategies That You Must Learn From Apple. (2014). What 7 Key Strategies Must We Learn From Apple’s Marketing? Retrieved from https://www.marketingexamples.com
  • Kotler, P., & Keller, K. L. (2016). Marketing Management (15th ed.). Pearson Education.
  • Porter, M. E. (1985). Competitive Advantage. Free Press.
  • Armstrong, G., & Kotler, P. (2017). Marketing: An Introduction (13th ed.). Pearson.
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  • Kim, W. C., & Mauborgne, R. (2004). Blue Ocean Strategy. Harvard Business Review, 82(10), 76-84.
  • Hollensen, S. (2015). Marketing Management: A Relationship Approach. Pearson Education.
  • Goi, C. L. (2009). A review of marketing mix: 4Ps or more? International Journal of Marketing Studies, 1(1), 2-14.

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